Ralph Simon: MidemNet – Monetising the "Mobilisation" of Music

In just a couple of days, MidemNet will begin and herald the start of the 2009 Midem gathering in Cannes. Despite the economic crunch seeping into many aspects of the mobile music and entertainment industry, there is much excitement and anticipation this year as evidence continues to mount that digital and mobile sales are driving today’s music business.

The MidemNet programme offers some compelling insights and “learnings” to those lucky enough to come to the sessions on Saturday and Sunday. There will be some exciting stuff from tech’s ‘bleeding edge’, and as the mobile music area shows big lift-off, it is going to be fascinating seeing two of the mobile industry’s global leaders – on Saturday, Tero Ojanopera, Nokia’s czar of mobile music, entertainment and services will lift the kimono on Nokia’s 2009 music plans. On Sunday, making his debut at MidemNet, Blackberry/RIM co-CEO, Jim Balsillie will reveal the exciting road ahead for RIM and Blackberry’s new touch screen devices and consumer applications and platforms.

This will prove to be extremely timely, and especially so in the wake of the comments this week by Rio Caraeff, the highly respected and able Executive Vice President of Universal Music’s eLabs unit. Rio said this week that mobile music services now accounted for about half of Universal Music Group’s digital business.

“About 40 to 45 percent of our overall digital business is coming from mobile channels like Verizon and AT&T,” Caraeff said in an interview with CNET, adding “On much of our new frontline pop or R&B or urban releases–everything from Fergie to Rhianna to Pussycat Dolls–we’re seeing mobile comprising 20 to 45 percent of the revenue for those artists, which is a tremendous amount.”

This is surely a great signal that the mobile base is growing and that the mobile consumer is becoming more adept at legally downloading digital and mobile music.

Whatever progress we seem to be making in the UK, USA or Europe, nothing can quite match the scale and volume growth that mobile music has seen in China. At a recent gathering in China, the chairman of China Mobile, the world’s biggest telco with 600,000,000+ subscribers expressed delight at the fact that over the past year China Mobile has sold $2bn of mobile music, far eclipsing the traditional music CD business in China.

One song was downloaded 10,000,000 times. Not quite the record of 25,000,000 downloads of one song, which was achieved by China Mobile in 2007. It was the Olympic Games’ theme song, “You & Me”, which saw 5.73 million downloads in 24 hours. The 10m was achieved in just 25 days. I think this might have established a new record for the fastest sales of a digital single in the shortest time. They even sold 20,000 “Cheer Me Up” mobile videos when the Olympic team was not faring well.

There is much talk amongst major handset makers about how to sharpen competition against Apple’s iTunes dominance, and it is going to be interesting to hear how Sony Ericsson and their Play Now Plus music service is going to be grown, as will be the case with Nokia’s Comes With Music, which will see a renewed launch in the UK and Europe over the next few months.

Cross-platform offdeck and ondeck are words that you will be hearing a lot of in the months to come. A revealing list of key issues for the music and the mobile entertainment industry was provided by the global headquarters of the Mobile Entertainment Forum. Following an extensive survey of their MEF’ members’ opinions, here are some of the key issues that will be given focus in the coming weeks and months by key execs and decision-makers in mobile and digital entertainment:

1. A proliferation of touch screen devices continues to drive discoverability and content usage
2. Telcos begin to act as enablers for the Entertainment industry with
services such as billing, authentication and zero tariff data driving
take-up
3. The emerging dominance of services that operate at a multi-platform level
4. The rise of ringback tones
5. Social networking becomes an important driver of mobile entertainment consumption
6. Emerging Economies will become an increasingly important driver for mobile entertainment worldwide
7. Mobile video will grow significantly in use and content search.

These pointers give a sense of where key areas of focus are going to be in the coming months. One thing is clear though: the “mobilisation of the music business is clearly growing and moving in the right commercial direction. What about pricing ? Well, Apple’s variable pricing move just announced, is another factor that will help lubricate catalog sales via digital and mobile and open up some welcome new thinking in pricing hits and catalog titles.

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This is the official blog of Midem, the destination for music business connections and knowledge, and its conferences (next edition: June 3-6, 2016, Cannes, France).
midemblog is edited by Reed MIDEM's social media team, with regular guest contributions from industry experts.